Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Ask HN: How come there is no Kickstarter for investing?

news.ycombinator.com

Post reply on HN
Print view View original

1–10 of 22 posts

Ask HN: How come there is no Kickstarter for investing?

#1

Post by knowledgesale »

I am willing to invest some money into risky startup-stage businesses. Naturally enough, I would like to invest in as many projects as I can in order to diversify my risks. Sometimes I am willing to invest/donate into a company that could serve an important social role or bring change without actually expecting profits. I suspect there are plenty of people like me.

The success of the Kickstarter site is stunning. I would like to see something similar for investment projects.

I am wondering why there is no such project.

Re: Ask HN: How come there is no Kickstarter for investing?

#2

Post by alexwestholm »

I think ownership and time are the major impediments. As an investor in a company, you're going to invest more than the small amounts that change hands on kickstarter, which will probably mean you want some degree of assurance in return for your money. So there's the equity part, which could be tricky to try to automate. And time wise, the projects that come up on kickstarter seem to be much shorter term than a startup would usually be, which just underscores the need for equity as a more formal commitment.

I'm sure there are ways around these issues, and I think it would be great if someone (you?) sat down and figured them out. But these are the reasons why it hasn't already been done, imho. If you can make it work, I'll definitely use it!

Re: Ask HN: How come there is no Kickstarter for investing?

#5

Post by gojomo »

Securities regulations. As soon as you're issuing stock, there are many legal requirements, and you can't just advertise/issue stock to the general public without the same complexity that accompanies being listed on big stock exchanges.

If all you want from an 'investment' is warm fuzzies and perhaps some token product/service or swag – like Kickstarter campaigns offer – then Kickstarter itself can be the Kickstarter of donating to risky startup projects.

If you're an accredited investor and savvy about angel investing, you could see about joining a dealflow-matcher/community of angels like AngelList (http://angel.co/).

Re: Ask HN: How come there is no Kickstarter for investing?

#6

Post by trotsky »

It seems to me the challenges would be that a) it'd be a mecca for fraud b) attract people who shouldn't be making such risky investments c) make it hard for startups to stay under 500 investors for public disclosure purposes and d) be sued into the ground due to a) and b)

Re: Ask HN: How come there is no Kickstarter for investing?

#9

Post by peteforde »

There's nothing stopping you from entertaining pitches from smart folks on Hacker News. Hell, I'd be happy to go first, if you invited it.

The nice thing about this strategy for you would be:

- even the dumb jerks on HN are generally really smart and working on cool projects

- taking initiative will make the story about you, which will bring you credibility and a higher quality deal flow

If you end up posting an "Ask HN: Why should I seed invest in your start-up?" let me know, and I'd bite.

Re: Ask HN: How come there is no Kickstarter for investing?

#10

Post by noodle »

jonbischke wrote: post #8

There sort of is: Profounder. More info here: http://techcrunch.com/2010/11/30/profounder-launches-to-help... and interesting thread of whether this is actually legal here: http://www.quora.com/Is-ProFounder-in-violation-of-any-secur...

looks more like a microfinance operation like prosper or lendingclub than actual investment. profits above and beyond repayment go to a nonprofit.
Post reply on HN